Fears VPNs could be blocked in piracy crackdown

Consumer groups and rights holders are at loggerheads over proposed changes to the Copyright Act which could see virtual private networks (VPNs) banned, preventing Australians from "geo-dodging" to access online content overseas.

Australian housing is among the most unaffordable in the world, a Demographia survey shows. Photo: James Davies

The Australian Communications Consumer Action Network (ACCAN) says ambiguity in the Copyright Amendment (Online Infringement) Bill 2015, currently before parliament, could see VPNs lumped with websites which "facilitate" copyright infringement such as The Pirate Bay or Isohunt, which rights holders will be able to apply to have blocked in Australia under the changes.

In a submission to a Senate inquiry regarding the legislation, ACCAN said banning VPNs would reduce competition and drive up costs for consumers, and called for a cost-benefit analysis of the scheme.

"ACCAN believes consumers should have the freedom to choose where they purchase content," the group said in a statement.

"Improved choice will also address some of the problems around access, delayed release dates and affordability which fuel piracy."

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But a prominent independent Australian film studio has defended the rights of content owners to make money through long-practiced territorial distribution arrangements, and supports a ban on the use of VPNs to "geo-dodge".

In an interview with media and marketing website Mumbrella, Cordell Jigsaw Zapruder managing director Nick Murray said territorial sales were "how we get our money" and that geo-dodging only benefited US streaming service Netflix and companies that sold VPN software.

"...normally you sell it [a title] territory-by-territory so the geo-blocker is very important," Mr Murray told the website.

"If someone has sold a show to Netflix in the US, if Netflix picks up an extra 200,000 subscribers in Australia illegally as they have been doing through VPNs, the people who made the show aren't getting more money."

CJZ has produced many high-profile Australian titles including House of Hancock, Go Back to Where You Came From, Bondi Rescue, Gruen Planet and The Checkout.

Mr Murray said Netflix knew about geo-dodging and that it could easily prevent the practice by shutting out customers with foreign credit cards.

But Netflix rejected the assertion, saying there were legitimate uses of foreign credit cards to pay for services in other jurisdictions, such as ex-pats or people who travelled often.

The company's view is that geo-dodging to access its services will eventually "disappear" as it expands its global reach and meets demand "directly" in each country.

In its submission, ACCAN threw doubt on the effectiveness of website blocking in reducing piracy, citing Dutch research which found blocking file-sharing sites had an immediate effect but "typically fades out after a period of six months as new sources for pirated content emerge".

ACCAN called for copyright holders to be made to foot the bill for implementing and maintaining a website-blocking scheme, arguing costs to ISPs would be passed on to consumers in the form of higher internet bills.